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Aid to the social sectors - achievements and mistakes

UNU-WIDER / Mar 2013

Susanna Wasielewski Ahlfors

The share of aid to social sectors has grown over the past 20 years. Evidence shows clear links between support to these sectors and poverty reduction, economic growth, and human development. But what works, and why? And how can donors support efforts to make aid even more efficient? These questions were raised and discussed during the ReCom Results meeting on aid and social sectors, held in Stockholm, Sweden 13 March.

’Social sectors are important to promote development, but they are also valuable in their own right – people prefer to be healthy‘, said Finn Tarp, Director of UNU-WIDER at the opening of the ReCom seminar. Aid going to health care, education, water and sanitation, and social protection is however a long-term investment; the result of saving a child’s life today will only show in 20-25 years when they get a job and become productive. Unfortunately, this long-term approach does not always fit with donor requirements for tangible short-term results.

’Most of the aid to health goes to project aid and very little to health systems. Project aid solves individual diseases, but it doesn’t solve national health problems‘, said Arnab Acharya, Professor at the Jindal Global University near New Delhi.

The WHO polio eradication programme came up as an example of how a single initiative that delivered great results in regard to eliminating the disease, never built up the long-term capacity of India’s own health sector. Once the project was terminated, none of the capacity, data, or knowledge stayed in the country.

’Part of the problem lies within the aid architecture; we are in the rush to see concrete results, so we take the winner, which may weaken the system of health institutions’, suggested PB Anand, reader in environmental economics and public policy at the University of Bradford, UK.

Development assistance for health has increased by a factor of five over the past 20 years and there are positive results: the under-five mortality rate in developing countries has fallen from 97 to 80 per 1000 live births, more children are being vaccinated, and maternal mortality has been reduced. But though national ownership is one crucial key to success, as agreed in the Paris declaration 2005, nearly 70 per cent of the world’s aid to the social sectors is still carried out through projects. Why is that? Arnab Acharya shared his views on the persistence of the project approach:

’The donors find it easy to finance projects, for accountability reasons. Also, many countries’ spending on aid actually benefits their own private sector, which is what they want.’

Education is another important part of aid to social sectors. Since 1999, over 50 million more children have been enrolled in primary school, and aid has certainly played a role here. Research shows that an increase of education aid by one per cent increases the rate of primary education enrolment by 0.06 percentage points. But the focus on the quantity of primary school enrolment – which is easy to measure – neglects the quality of education, which is very weak in many countries.

The project aid approach and lack of national ownership were once again mentioned as obstacles to a long-term development. Abby Riddell an aid-education expert has a long experience of working with educational planning and school effectiveness and she urged the donor community to be self-critical:

’We need to let the people explain what they need, instead of getting off the plane and present a ready-made offer. The human process of developing ownership is done at provincial level, in districts and in schools. We have to start seeing local people as colleagues and drivers of their own development.’

So what is the best way to achieve national ownership, and is budget support a better alternative? Those were some of the questions from the audience.

Zulfiqar Bhutta from Aga Khan University in Pakistan would not opt for budget support as it makes accountability almost impossible. He would rather see a hybrid model, with strong national leadership and governance, as well as a better harmonisation and alignment between donors, who would have to work together and listen to the recipient countries’ needs.

Romain Murenzi, Director of The Academy of Sciences for the Developing World in Trieste was previously the minister of education in Rwanda. He shared his thoughts on how national ownership can be successfully achieved.

’When different donors came presenting their plans in Rwanda, I invited them all in to the same room, together with civil society organisations, the church, academics and others. We met every year, discussing the needs of the education sector, and all donors decided to put money into a basket‘, he said.

Rwanda is indeed a positive example of progress within education, standing out among other developing countries with a top literacy rate among students after completing primary school.

Charlotte Petri Gornitzka, Director-General at Swedish Sida, was one of the donors invited to comment on the discussions. She was not convinced that donor funding in a common basket would be the best way forward.

’That is an alternative, but our donor agency is based on tax money, so we need to be able to see the achievements of what we are doing, and scrutinize the work being carried out. But we need to work more long-term, and communicate with people we cooperate with. We are working hard on this but there is more to do‘, she said.

Tove Degnbol, Head of Department in Danida said she really appreciated the day’s presentations, though many of the findings were already well known to the donors.

’We know about the importance of country ownership, but we need to be reminded of what happens when we don’t follow best practices. You clearly pointed out the problem of donor fashion, of leaving and entering different areas and shifting focus for aid according to our own political shifts. It’s good to be reminded that we still have a long way to go‘, she said.